Alamo Beer cleared to purchase controversial lot

1of 5The Alamo Brewery (shown here) originally had planned to use the disputed 1.7-acre property as the site of its brewery. But it shifted the brewery to a neighboring site after the Hays Street Bridge Restoration Group protested the plan.Photo: Edward A. Ornelas, Staff / San Antonio Express-News

2of 5A view of the vacant property that is the focus of a dispute between the city and a community group.Photo: Edward A. Ornelas, Staff / San Antonio Express-News

3of 5The Alamo Brewery (shown here) has received City Council’s approval to use a neighboring vacant lot for parking and a mixed-use development.Photo: Edward A. Ornelas, Staff / San Antonio Express-News

5of 5Alamo Brewery has just finished work on the brewery and is getting ready to open for business.Photo: Edward A. Ornelas, Staff / San Antonio Express-News

The Alamo Beer Co. won permission Thursday from the City Council to use the vacant lot next to its newly-built brewery and the Hays Street Bridge for parking, a restaurant, retail space and perhaps multifamily housing.

“It’d be wonderful if the neighborhood was restored to what it used to be, which was one of the most desirable neighborhoods in San Antonio at the turn of the 19th Century,” Alamo Beer owner Eugene Simor said.

But the Hays Street Bridge Restoration Group — which battled the city in court over the lot at 803 N. Cherry St., and won — is looking into whether the council’s vote Thursday violates the court’s decision, which outlined acceptable uses for the property.

The local brewer originally had planned to build the brewery on the Cherry Street property. But the bridge restoration group, a nonprofit that raised funds to restore the East Side landmark, filed a lawsuit claiming that the land had been donated by its previous owner, BudCo Ltd., for use as parkland. The city disagreed, arguing the lot was donated to the city carte blanche.

The lawsuit delayed the brewery for more than a year, Simor said, and forced him to begin building at 415 Burnet St., property he owns on the other side of the bridge from the parcel in question.

In September, Judge David Canales ruled that funds stemming from the the 1.7-acre property should go directly into the city’s budget for the bridge’s restoration.

The bridge restoration group claims that the jury in the case defined the word “funds” to include the land itself.

“Funds certainly includes the property itself,” said Amy Kastely, the group’s attorney. “That was one of the findings of the jury that the judge upheld.”

The city attorney interprets Canales’ decision very differently.

“We don’t believe the court order requires us to use the property itself as real estate for the (bridge) project,” interim City Attorney Martha Sepeda said. “The court order says that we apply the funds — from the sale of the property, or whatever other way we could get funds from the property — and put it into the city budget for the bridge.”

After the jury verdict, the city filed a motion for a new trail, but a judge has yet to rule on the request.

The two sides met at least twice since Canales’ ruling to negotiate the property’s use. The restoration group did not attend the City Council meeting because, a representative said, its members were under the impression that negotiations were ongoing.

“We were shocked and disappointed that this came out,” said Gary Houston, a member of the Hays Street Bridge group. “Nobody even let us know that this was, in fact, a response to some of the negotiations that had been held.”

Sepeda, on the other hand, said talks had collapsed.

“We couldn’t come to an agreement, and the council has to move on with the project,” Sepeda said.

In those talks, the group expressed concern about development that would block onlookers’ view of the bridge.

On Thursday, the council agreed to an amendment to the city’s deal with Alamo Beer that would impose height limitations of any development to five stories or less, prohibit a hotel and require Alamo Beer to upgrade the landscaping. The terms of the agreement, which grants the company an incentive package worth nearly $800,000, also were extended to June 30, 2015. The city is selling the property to the beer company for $295,000.

Kastely said she wants to see the actual amendments to the incentive agreement before deciding whether to seek a temporary restraining order.

At the council meeting, city officials rhapsodized about the project as a catalyst for the near East Side.

“Neighborhood change is difficult, but I think that this is exactly the type of project that is poised to help turn around a part of town that hasn’t seen a lot of investment,” Mayor Ivy Taylor said.

After the vote, Simor was congratulated by a handful of city officials and Dignowity Hill residents. Even City Manager Sheryl Sculley left her seat on the dais to meet Simor in the back of council chambers to congratulate him.

Alamo Beer has scheduled its brewery ribbon-cutting for Friday, and could begin brewing as soon as a week, Simor said. The public opening is scheduled for March.

Benjamin Olivo started at the Express-News in 1996 taking down high school football starts on Friday night's in the sports department. He's also worked on the Metro, business and features desks. He's been writing about downtown San Antonio on The Downtown Blog on mySA.com since June 2008, and in the weekly Downtown Dispatches column in the Express-News since spring 2012.